NVIDIA supplying half of AMD’s chipsets, likes life as an independent

On this day of AMD related news, we take a quick look at NVIDIA's place in the …

When news of the ATI-AMD rumor first happened, rumors erupted everywhere. What does this mean for Intel? NVIDIA? Grandma? A few rumors even had legs, but most sidelined common sense in favor of a philosophy steeped in The Young and the Restless, seeing scorn and derision around every corner. This was especially true for those stories which claimed that Intel and NVIDIA would be changing their relationships with both AMD and ATI overnight. The reality is that AMD and NVIDIA are still close business partners, and NVIDIA is still happily waving the flag of independence. On this day of AMD related news, we take a quick look at NVIDIA.

AMD needs NVIDIA, too

Now that the $5.4 billion ATI-AMD merger deal has been completed, eyes turn towards the future. AMD today already announced plans for a new "Fusion" project aimed at integrating graphics and x86 CPU functions on a single piece of silicon. Is NVIDIA, or Intel for that matter, scared?

NVIDIA has had a mostly positive business relationship with AMD for over 10 years—a relationship that includes the beginnings of the quite successful nForce chipset deal that gave AMD a motherboard chipset that could be respected. Many years later, the graphics guru still supplies nearly half of the chipsets used by AMD, and will continue to do so for the foreseeable future.

"NVIDIA and AMD have innovated together for over a decade. As a result, NVIDIA GeForce and nForce processors set the standard for AMD systems. AMD's open platform strategy enables continued partnership aimed at providing customers with a wide choice of industry leading solutions," said Dan Vivoli, executive vice president of NVIDIA, in a prepared statement.

Furthermore, VP of investor relations Mike Hara told Reuters in an interview that his company didn't "want to be tied up" with an acquisition. "I don't think anything changes [in light of the ATI-AMD merger]. In fact, what we've already felt and seen I think gives us the energy to push faster. While AMD and ATI figure out what their future looks like, we know what ours looks like," Hara said.

Thus NVIDIA's plans for now remain largely unchanged. The company will continue to supply AMD with chipsets and the company is also working on designs for future AMD-related projects. Is all of this a grooming phase to attract Intel?

As you may know, we're generally down on the concept of an Intel buyout of NVIDIA, mostly because the numbers don't make sense. NVIDIA trades these days with a total price tag of $11 billion, putting the general buyout target far, far north of the $5.4 billion ATI deal. While NVIDIA has superior cash flow to ATI, their annual sales are comparable. This makes NVIDIA a quite expensive acquisition, and for what? Intel already makes its own chipsets and graphics processors. Admittedly, Intel is not a player in the premium graphics scene, but all signs point towards Intel getting into that business sooner rather than later.

For the time being, we don't expect to see anything change with regards to NVIDIA's ownership or, just as important, its deals with either Intel or AMD.

Ken Fisher / Ken is the founder & Editor-in-Chief of Ars Technica. A veteran of the IT industry and a scholar of antiquity, Ken studies the emergence of intellectual property regimes and their effects on culture and innovation.